Music Royalties Initiative Unites YouTube, Spotify, Labels

A new music rights initiative aims to streamline the way labels and artists get paid when their works are streamed. The Open Music Initiative (OMI), a joint effort by the Berklee College of Music, MIT and others, has managed to attract support from the three major labels, several major streaming services, an agency that grants licenses to use copyrighted material and other industry leaders for a total of more than 50 founding associates. OMI will be hosting an inaugural gathering, welcoming reps from all of the organizations, in New York City on June 22nd.

OMI’s mission is to establish standards and advance the way the industry administers music rights and “to help assure proper compensation for all creators, performers and rights holders of music,” according to its website. It hopes to create new technologies that will simplify the way rights owners are identified and paid, and its overarching goal is to create something that will help sustain the entertainment industry.

Berklee’s Institute for Creative Entrepreneurship is leading the initiative with support from MIT Media Labs, the latter of which is helping to create a platform for OMI. They are also working with researchers and faculty from University College London and other academic institutions, as well as design and tech companies. “This is the first time that [an] effort is led by a broad coalition that includes academic institutions, entrepreneurs, technologists, nonprofits and, most importantly, enjoys representation from all facets of the music industry unifying around the issue,” a Berklee rep announced.

The list of companies that have signed on to participate in OMI reads like an entertainment-industry role call. Associated record labels include Universal, Sony, Warner and BMG. Affiliated streaming services include Spotify, YouTube, Pandora, SoundCloud, Netflix, Sirius XM and others. Other notable partners include Harry Fox Agency – which collects royalties and issues licenses on behalf of music publishers – and its rights-management affiliate, Rumblefish, as well as the Music Managers Forum and Future of Music Coalition.

“We think transparency across the entire music economy is essential to rewarding artists, songwriters and everyone involved in the creation of music fairly and rapidly,” Jonathan Price, Spotify’s global head of communications, said in a statement. We’re really happy to be part of an effort that is exploring innovative ways to do that with new technologies.”

“Unnecessary complexity and outdated processes ultimately cost songwriters and artists money and damage the credibility of the music industry. That’s why BMG is delighted to support this initiative,” Laurent Hubert, president, creative and marketing at BMG U.S., said.

“Music’s standards, notably music publishing, is largely outdated and has not caught up with the digital era,” Joe Conyers III, VP tech for Downtown Music Publishing, which administers music by John Lennon, Bruce Springsteen, One Direction and others, said. “Today’s industry needs open source standards to create time and cost efficiencies, grow the pie and increase transparency for music rights owners.” Conyers is also the general manager of Songtrust, which creates royalty reports and allows songwriters to register their works with Downtown.

In addition to its summit later this month, Berklee will host a three-week innovation lab for OMI in Boston in mid July. The organization is also looking for new members.

“It’s not a secret that the infrastructure of the music industry, especially the one around creative rights, has not evolved to accommodate for the ways that music is being created and consumed today,” Panos Panay, cofounder of OMI and founding managing director of BerkleeICE, said in a statement. “We want to use the brainpower, neutrality and convening ability of our collective academic institutions, along with broad industry collaboration, to create a shared digital architecture for the modern music business. We believe an open sourced platform around creative rights can yield an innovation dividend for creators and rights holders alike.”